Last week, I got yelled at on Twitter for saying ” we don’t have a healthcare problem, we have a health problem.”
Twitter is dangerous because there is no room for nuance. When I saw how upset people got about it, I started to feel bad. I took some time to step back and clarity for myself the context behind my point and the message I was really trying to get across.
What I came up with is that the root problem of our healthcare system (also our prison system) is that the incentives are based around treating rather than preventing.
The United States healthcare system will never work the way it is because it is reactionary. The system should be preventative instead of reactive.
Healthcare is difficult to talk about because everyone has their own story and unique perspective, so it’s hard to make generalized statements when there are obvious exceptions to everything.
As is always the case, problems present opportunities. The opportunity in this space is unparalleled. My favorite part about this space is that founders will be creating businesses that serve themselves, serve people, and serve humanity.
Let’s get started. 👇
The Opportunities in Health Tech
If anyone reading this is wanting to start a business but doesn’t know where to start, my advice is to think of health problems and then create programs to PREVENT those problems.
These companies will EXPLODE over the next 10 / 20 or even 100 years.
I’ve listed some examples below.
Senior Citizen Fall Prevention
The company creates exercise programs for senior citizens. These exercises improve balance, improve strength, and PREVENT falls.
It’s significantly cheaper to prevent a fall in a senior citizen than it is to treat a broken a hip. The best part is it increases the quality of life for the person who never had to experience a fall in the first place.
Broken hips in seniors are catastrophic. In some cases, they’re death sentences.
This is a simple, but profound example of preventative health tech at work.
Imagine how successful this company could be if they are able to prove that their programs are saving the system hundreds of millions of dollars in healthcare costs while also improving quality of life for their customers.
Medication Assisted Treatment
In addition, there are a lot of upstart opportunities for medication assisted drug treatment. The data on this has become pretty clear. When people with substance use disorder are attempting to get their lives together, medication to prevent cravings and to “soften” the withdrawals over the first year provides tremendous value.
Preventing heroin overdoses is much better than treating heroin overdoses.
When someone overdoses on heroin, there are associated costs with…
- ambulance rides
- ER visits
- addiction treatment
- continuous therapy
- loss of state and federal income tax (many times, desperate heroin addicts commit felonies which means bad employment options)
I know first hand the importance of this model. This is why we created Medicallyassisted.com and why I am actively looking to find investment opportunities in this space. I’m an advocate for addiction treatment, but I’m also an advocate for prevention.
When people die of heroin overdoses, it’s usually because they go to treatment, get sober, and live an abstinent lifestyle for a few months. When they relapse, they shoot up with the same doses they are used to, but now their body doesn’t have the tolerance and it kills them.
All of my friends who have died from heroin overdoses have fallen into this same pattern. The cost of this cycle puts billions of dollars of stress on the healthcare system and creates unspeakable tragedy in families and circles of friendship.
But what would happen if instead of going “all in” with complete sobriety, we created a years long runway with medication and support where people treating their substance use disorder were able to prevent that first relapse in the first place?
The implications are astounding and the opportunity in this space is endless.
The success rates of long term recovery shoot way up when people make it a full year without any relapses. I see a huge opportunity for a tech platform that combines medication with support and helps people through the first year of recovery with no relapses. This could increase the success rates of addiction recovery by 10X.
The problem is, the treatment system is incentivized to treat drug addiction, it’s not incentivized to prevent it.
Diabetes + Heath Failure + Kidney Failure
The business of treatment for these diseases ranges in the billions of dollars. A few people get very rich off of the suffering of society. But still, very few of the upstarts focus on prevention.
Just recently, in 2018, Livango raised another $235M and was acquired by Tele Doc. The technology to treat the patients is changing, but the method in which we prevent them is still the same.
The leverage that the health tech providers are implementing will only increase the profit margins of the companies, while funneling money from the insurance companies up to investors.
So the money keeps the cyclical nature of treatment as the status quo.
What if a preventative health tech company could lower the diabetes rates in our country by even 1%? How much money would the system save and how valuable would that company be?
That’s easily a billion dollar company.
Could there possibly be an industry more vulnerable to disruption?
This is a multi billion dollar market that is dependent on keeping people sick.
How much market share could be stolen if instead, a new market was created that prevented people from getting sick in the first place?
My prediction is that over the next 5 years, we will continue to see a number of upstarts who are playing in the preventative health tech game. These upstarts will focus on prevention and will work in health sectors such as fall prevention, heart attack prevention, diabetes prevention, addiction prevention and others.
Eventually, we will see big winners who flip the entire industry on its head.
I don’t think the American healthcare system can be fixed with legislation and policy change within the government. All this will do is continue to shift money around without actually addressing the root cause, which is the incentive.
Once the capitalist structure of supply and demand shifts, we will see change.
Meaning, once preventing people from getting sick is more lucrative than treating sick people, that’s when the healthcare success will be fixed.
Don’t @ me.